Tag Archives: complexity

The Nature of the Beast (Post)

[This post is addressed to fringe economists and others who have broken with ever-more dysfunctional mainstream neoclassical economics, but who still search for a replacement paradigm.]

[2 Aug:  Posted on Real-World Economics Review Blog.]

The need for a new conception of economics is widely acknowledged in the wake of the global financial crisis[1], at least outside of diehard neoclassical circles.  However a common perception seems to be that no adequate and coherent general conception is in sight, though many loosely related or unrelated heterodoxies vie for attention, as noted by the Editor of Real World Economic Review blog.  I argue here that when the subject is approached from the point of view of dynamical systems a broad new framework becomes evident.  Furthermore, once the nature of the beast is identified, some fundamental conclusions can immediately be drawn.

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The Underlying Crisis in Economics – Mistaking the Beast

Extracts from Economia.

The writing of Economia was essentially completed in 2003.  It was obvious then that the global financial system must come to crisis within a few years.

The Global Financial Crisis, serious as it is, is only part of a deeper crisis reaching to the core of how modern economies are conceived and managed.  The problem is not just that financial markets have acquired excessive power and are greedy, corrupt, unstable and destructive.  It is not even that the GFC has not yet shown us its worst, as Steven Keen argues (Declaring victory at half time).  It is that mainstream economists have fundamentally mis-identified the nature of the beast they are dealing with.

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